Saudi GDP will grow by 4.1pc in 2010

Saudi Arabia’s economy is expected to grow by 4.1 percent in real terms in 2010 as domestic demand in the top OPEC (Organization of the Petroleum Exporting Countries) oil exporter will pick up, EFG-Hermes said in a report.

In 2011, GDP growth in real terms will accelerate to 4.5 percent with the non-oil sector improving, driven by government investment programs and private consumption, the investment bank’s Chief Economist Monica Malik said in a report.

“We expect a notable improvement in the economy in 2010 and 2011,” Malik said. “Along with net exports making a positive contribution, we also expect to see a pickup of domestic drivers, especially as government projects announced in 2009 start to be implemented,” EFG said.

Non-oil GDP will rise in real terms by 4.4 percent in 2010, up from 3 percent this year, the report said, adding that annual inflation would be around 4.4 percent on average next year.

“With only a tentative recovery in credit growth we expected limited (if any) increase in interest rates in 2010,” the Egyptian bank said.